The demand for unionized labor will generally be more elastic, and it will be more difficult for the union to achieve above-equilibrium wages when
A) there are many close substitutes for the unionized workers.
B) trade barriers limit the importation of the product produced by the unionized workers.
C) the cost of employing the unionized workers is a small part of the total cost of product that they produce.
D) the demand for the product produced by the unionized workers is highly inelastic.

Question

Quizplus · Accepted Answer

When there are many close substitutes for unionized workers, employers can more easily replace them, making the demand for their labor more elastic and making it harder for unions to secure higher wages.

The Demand for Unionized Labor Will Generally Be More Elastic